Nigeria’s currency gained 3.98 percent to close at N394/$ on the Investors and Exporters window, Monday, from N409/$ after the Central Bank of Nigeria (CBN) sold some dollars to banks at the Investors and Exporters (I&E) foex window.
The CBN and non-bank corporates have been the major suppliers of dollars, providing more than 90% of foreign exchange inflows at the I&E window.
Total foreign exchange sales to authorised dealers by the CBN amounted to US$4.37 billion in the third quarter of 2020, a decline of 2.3 per cent from the level in the preceding quarter, according to the CBN’s Q3 economic report.
The naira’s initial depreciation to N410/$ was cheered by several analysts who have been left disappointed by the CBN’s latest intervention.
Many analysts reacted to the earlier news that the CBN adjusted the rate from N394 per dollar to N410.25k/$ on December 31, 2020, making the third naira adjustment in the same year.
“This an encouraging development as it brings the naira closer to it’s fair value. This will make it more expensive in naira terms to buy dollars (for imports, etc) at the I&E window, which should ease the demand for dollars, somewhat,” Yvonne Mhango, head of research, SSA and SSA Economist at Renaissance Capital, said on Monday.
The foreign exchange market opened the year with naira unchanged at N470 against the dollar at both the Bureaux De Change (BDC) segment and the parallel market.
